Daniel Han, Alpha Securities
BUY RECOMMEMNDATIONS
Sydney Airport (SYD)
Chart: Share price over the year
The share price has risen as tourism statistics reflect increasing travel to Sydney in the past few years. Chinese tourists continue to pass through Sydney Airport in growing numbers. So much so that China’s Xiamen Airlines is also expected to fly to Sydney Airport more frequently from October 31, 2016. This suggests further upside.
TPG Telecom (TPM)
Chart: Share price over the year
A solid performer, its success can be largely attributed to acquisitions that have expanded its presence in the telecommunications market. The company’s dividend yield is attractive. We expect TPM to benefit as it extracts synergies from last year’s acquisition of iiNet.
HOLD RECOMMENDATIONS
Evolution Mining (EVN)
Chart: Share price over the year
We believe the gold price had overshot on the way up following concerns about Brexit and global uncertainty. If the gold price corrects, we would expect Evolution Mining’s share price to follow suit. But the company’s increasing production offers a bright outlook.
Boral (BLD)
Chart: Share price over the year
An increase in building approvals in the past few years has been positive for this building materials maker. Continue holding as we expect the company to perform well because we retain a robust outlook on the Australian and US property markets.
SELL RECOMMENDATIONS
Woolworths (WOW)
Chart: Share price over the year
The shares have been falling for about two years. Fierce competition in the supermarket space presents challenges. Competitor Aldi is growing market share. The Masters home improvement business is a burden. We don’t expect a turnaround at Woolworths in the short to medium term.
Orica (ORI)
Chart: Share price over the year
The commercial explosives provider continues to struggle given a subdued mining sector. It reported a statutory net profit after tax of $149 million for the six months to March 31, 2016, down from $222 million in the prior corresponding period. We expect a subdued performance until mining sector activity improves.
Michael Heffernan, PhillipCapital
BUY RECOMMENDATIONS
Vocus Communications (VOC)
Chart: Share price over the year
VOC is rapidly becoming a major player in Australia’s internet and telecommunications markets after acquiring telco and fibre company NextGen Networks. It’s been a stunning performer in the past year following its previous takeover of Amcom, and its future growth is strong. Mayne Pharma (MYX)
Chart: Share price over the year
This spin off from the former Mayne Group is now focusing on pharmaceutical production and distribution. It recently acquired major international generic drug businesses at attractive prices, and has become a major player in the US retail generic drug market. Its future prospects look good. HOLD RECOMMENDATIONS
Bapcor (BAP)
Chart: Share price over the year
This distributor of aftermarket automotive parts has been a strong performer since listing two years ago. Acquiring automotive businesses from Metcash has been positive for earnings growth. Commonwealth Bank of Australia (CBA) 
Chart: Share price over the year
Still Australia’s premier bank. We expect a calmer banking sector after Brexit and the federal election. Share prices should continue to recover. Expect CBA to pay an attractive final dividend when it delivers full year results on August 10. SELL RECOMMENDATIONS
Newcrest Mining (NCM)
Chart: Share price over the year
NCM’s share price has sky rocketed on the back of a rising Australian dollar gold price. However, waning uncertainty following Brexit and the possibility of a clearer global outlook emerging may lead to an easing US dollar gold price. It may be time to lock in some NCM profits.
Bradken (BKN) 
Chart: Share price over the year
This consumables producer for the mining sector has failed to benefit from the recovery elsewhere in the sector. It’s more a stock for traders and risk takers until it re-establishes a profit record.
Simon Herrmann, wise-owl.com
BUY RECOMMENDATIONS
Monadelphous Group (MND)
Chart: Share price over the year
This engineering group is well placed to benefit from a recovery in the depressed mining services sector. Diversifying into the marine infrastructure sector and undertaking cost restructuring measures should cushion the impact on results caused by the cyclical downturn. Most key commodity prices have been recovering this year, and this should enable management to reward shareholders via attractive dividends. The stock is trading on an undemanding valuation and we estimate a dividend yield of about 7 per cent.
GALE Pacific (GAP)
Chart: Share price over the year
Makes building products and distributes a range of polymer textiles. We’re attracted to the company’s revenue growth, increasing demand for its products and improving operational performance, which are expected to improve profit margins. Earnings volatility and balance sheet gearing are primary hurdles.
HOLD RECOMMENDATIONS
MACA (MLD)
Chart: Share price over the year
This mining and civil construction company is generating free operating cash flow. Its order book of about two times revenue provides good financial visibility at the bottom of the industry cycle. The company has a strong history of rewarding shareholders via high yield dividend distributions. A strong balance sheet enables counter cyclical acquisitions. Following the recent price increase, we recommend a hold.
XTD (XTD)
Chart: Share price over the year
XTD is generating strong revenue growth and management is also targeting expansion into the south east Asian and US rail networks. XTD offers transitional exposure to digital media and the transport advertising market. The recent decline in valuation is due to negative market sentiment towards small cap technology and software companies. However, in our view, the outlook remains generally favourable.
SELL RECOMMENDATIONS
iSentia Group (ISD)
Chart: Share price over the year
Investors have been continuing to sell down this media monitoring company. Despite posting revenue growth, costs have risen at a higher rate and profit climbed only 7 per cent during the 2016 first half. iSentia’s price/earnings ratio was recently trading above 30 times, even though its share price has significantly fallen since December 2015.
Dongfang Modern Agriculture Holding Group (DFM) 
Chart: Share price over the year
Another Chinese listing leaving unanswered questions following the latest selloff. The stock appears volatile. In our view, the lack of transparency is an issue. DFM recently acquired $US60.19 million in plantations. Our advice is to sell now and wait to see if the stock can consolidate.
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